Royal Mail apologises for breaching stamp price cap after announcing increases

Royal Mail has apologised after announcing that first and second-class stamp prices are set to increase above the price cap in place to make the postal service affordable.

The price of a first-class stamp will increase by 3p to 70p, while a second-class stamp will rise to 61p from 25 March.

It means that the second-class stamp price will breach Ofcom’s price cap of 60p, which is in place until 1 April.

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Royal Mail says it will donate the extra revenue, expected to be £60,000, to charity Action for Children.

The current price cap was set in 2012 following a 14p rise in stamp prices after concern the service was at risk.

It was set at 55p and would rise in line with inflation, making the current official cap 60.65p.

Royal Mail said it informed Ofcom of its error before announcing the price increase on Friday.

"We apologise for this mistake," a spokesman for the company said.

"We are putting this right by donating the revenue that we expect to collect from the error – around £60,000 – to our chosen charity Action for Children, which helps disadvantaged children across the UK."

Despite the increase, Royal Mail says its stamp prices rate among the best value in Europe.

"The UK also has one of the highest quality of service specifications of any major European country", it says.

The company said in a statement: "Royal Mail understands that many companies and households are finding it hard in the current economic environment.

"As a result, we have considered any pricing changes very carefully and in doing so have sought to minimise any impact on our customers."